MBIA to split muni, structured finance units within 5 years
SAN FRANCISCO (MarketWatch) — MBIA Inc. said on Monday that it will split its
municipal bond business from its structured finance business within five years.
The company also said it has suspended taking on any new structured finance risks
for six months.
“My goal is to retain the highest ratings that we can for both our structured and public finance businesses, and I believe this can be accomplished by separating these two business lines and leaving the derivative
market to the traders on Wall Street,” Jay Brown, chief executive of MBIA, said
in a letter to investors which was released publicly. Brown also warned that MBIA
may take another charge during the first quarter related to the market value of
some of the company’s credit derivatives transactions.
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